Rental prices to soar in 2011: RP Data
A lack of supply in the housing market will put extra pressure on rental prices across Australia this year, according to RP Data.
RP Data's Rental Review for the December quarter in 2010 shows that rents in capital cities rose 4.2 per cent last year, compared with a 2.9 per cent rise nationally.
But analyst and report author Cameron Kusher expects rental prices to accelerate over the next twelve months.
"We're expecting that rental growth is actually going to be quite a bit stronger than what we've seen over the last 12 months to 24 months," Mr Kusher told the ABC last week.
"It hasn't really been that strong when you look back a little bit further how much rents were growing, and we expect rents will increase for both houses and units by at least 5 per cent and possibly 7 per cent by the end of 2011."
Darwin has been named the most expensive city in Australia to rent a house, with a median rent of $520 per week. It is followed by Canberra at $490 and Sydney with a median weekly rent of $450.
The cheapest capital cities to rent are Adelaide, where renters pay $325 on average per week, and Hobart at $335.
"Across the combined house and unit market, rents increased by $80 per week between March 2006 and December 2008 across the country whilst capital city rents increased by a total of $90 per week," Mr Kusher said.
The data also showed median weekly advertised rents for capital city houses increased 1.3 per cent and units 1.4 per cent for the quarter and sit at $380 per week and $365 per week, respectively.
Nationally, rents for houses and units showed no improvement during the December quarter and both houses and units have a median rent of $350 per week.
The most expensive place to rent in Australia? Western Australia’s Pilbara region. The median weekly rent, across both units and houses, was $1,650 last quarter – an increase of 10-percent.
Mr Kusher says while there’s a strong demand for more investments properties, he does not expect the situation to encourage more buyers to enter the market.
"More [housing] supply would be a very good thing to help curtail those predicted increases in rental rates, but at the moment developers just can't really make that new stock stack up,” he said.
"Affordability is the biggest issue at the moment in the housing market and that's why we are not seeing a lot of first-home buyers particularly active at the moment.”